Quants Research Institute Holdings Inc (9552) Q1 2025 earnings summary

Executive summary

• Q1 FY2025/9 net sales were ¥4,178mn, down 14.7% YoY; operating profit was ¥1,684mn, down 49.8% YoY; operating margin fell to 40.3% from 68.4% a year earlier.

• Ordinary profit and profit attributable to owners of parent both declined 49.7% and 49.8% YoY, respectively.

• M&A brokerage revenue dropped 19.1% YoY to ¥3,956mn, with operating profit down 47.2% YoY to ¥1,740mn; consulting business sales reached ¥222mn, nearly matching last year's annual sales.

• Number of M&A advisors at Q1-end was 306, with 363 including confirmed hires; consultant headcount increased to 43, with 94 including scheduled hires.

• A new Singapore subsidiary was established to secure overseas M&A deals.

Financial highlights

• Gross profit margin declined to 65.3% from 82.6% YoY; gross profit for Q1 FY2025 was ¥2,728mn, down from ¥4,046mn YoY.

• Net income was ¥1,092mn, down 49.8% YoY, with net income margin at 26.1%; net income per share was ¥18.68, compared to ¥37.25 in Q1 FY2024.

• Cash and deposits increased to ¥10,445mn; total assets rose to ¥12,330mn, and net assets to ¥10,131mn.

• Equity-to-asset ratio improved to 82.1% from 75.1% at the previous year-end.

• Depreciation and amortization for Q1 FY2025 was ¥16mn, up from ¥8mn YoY.

Outlook and guidance

• FY2025/9 full-year net sales forecast is ¥23,200mn (+40.2% YoY), operating profit forecast is ¥10,400mn (+23.7% YoY), and EPS is projected at ¥115.19–115.47 (+16.6–16.8% YoY).

• M&A brokerage segment expects net sales of ¥22,000mn (+35.0% YoY) and operating profit of ¥11,000mn (+26.6% YoY); number of advisors targeted at 400–450.

• Consulting business sales forecast at ¥1,200mn (+385.8% YoY), with 80–100 consultants planned.

• No revision to earnings or dividend forecasts despite Q1 underperformance; management expects retention and recruitment measures to support plan achievement.